complete a risk analysis

complete a risk analysisMost of these firms typically hold onto stocksdvd to avifor a few seconds, minutes or hoursdvd to aviand usually end the day with little or no position in the market. Their profits come in slivers of a penny, but they can reap those incremental rewards over and over, all day long.

What all high-frequency traders love is volatility — lots of it. “It was like shooting fish in the barrel in 2008. Any dummy who tried to do a high-frequency strategy back then could make money,” said Manoj Narang, the founder of Tradeworx.

A quiet man with a quick wit and a boyish enthusiasm, Mr. Narang, 40, looks like he came out of central casting from the dot-com era. Wearing jeans, a gray T-shirt and a New York Yankees hat, he takes a seat in front of his computer terminal and quietly answers questions about his business, glancing occasionally at the Yankees game in one of the windows on his PC.

After graduating from M.I.T., where he majored in math and computer science, Mr. Narang bounced around Wall Street trading desks before starting Tradeworx in the late 1990s.

At the time, Wall Street was at the beginning of a technological evolution that has changed the way stocks are traded, opening a variety of platforms beyond the trading floor.

The Tradeworx computers get price quotes from the exchanges, decide how to tradedvd to avi, complete a risk analysis and generate a buy or sell order — in 20 microseconds.

The computers trade in and out of individual stocks, indexes and exchange-traded funds, or E.T.F.’s, all day long. Mr. Narang, for the most part, has no idea which stocks Tradeworx is buying or selling.

Showing a computer chart to a visitor, Mr. Narang zeroes in on one stock that had recently been a winner for the firm. Which stock? Mr. Narang clicks on the chart to bring up the ticker symbol: NETL. What’s that? Mr. Narang clicks a few more times and answers slowly: “NetLogic Microsystems.” He shrugs. “Never heard of it,” he says.

If high-frequency traders crave volatility, why did Tradeworx and others turn off their computers on May 6?

Mr. Narang said Tradeworx could not tell whether something wasdvd to aviwrong with the data feeds from the exchanges. More important, Mr. Narang worried that if some trades were canceled — as, indeed, manydvd to aviwere — Tradeworx might be left holding stocks it did not want.